While on college visiting trips with my son, I became acutely aware of the difference between entrepreneurship, as an academic field, and business. My impression is that the more traditional business programs are looking for candidates who will be easiest to funnel into traditional business jobs: honors math students who can follow orders brilliantly and look good in a tie. Great future entrepreneurs, on the other hand, may be harder for an admissions office to pick out, given that some of the biggest success stories of our time involve very creative but unruly dropouts who may never have even worn a tie (or high heels, as the case may be).

How do you teach entrepreneurship? Entrepreneurs need business skills, because they need to be able to build creatively on a solid foundation. And they need to think in terms of whole systems. Academia, and careers, normally work in silos. We specialize in one type of engineering, or a branch of medicine or law. If we are in the R&D department of a large manufacturing company, we aren't given a drawing board and a blank check; someone higher up will arbitrate the right balance between what we are proposing and the needs of all the other departments, including finance. We stay in our silo and deliver what is asked of us, rarely thinking about the living organism that is the whole giant corporation. But an entrepreneur needs to look at the whole picture. She needs to see the forest, and then be able to zoom in and manage the trees, too.

This is particularly true in social entrepreneurship, given that its goal is to make an impact, to change the status quo. A social entrepreneur needs to see a societal problem and understand the whole fabric of why the problem exists and what the obstacles are to a solution taking hold and making a sustainable impact. The business plan needs to take into account all these obstacles, as well as the usual cost analysis and funding projections.

"I think of social entrepreneurship as an incredible R&D lab for social and environmental problems," says Cathy Clark, adjunct professor at the Center for the Advancement of Social Entrepreneurship (CASE) at Duke University's Fuqua School of Business. "Every university is digging into it, and undergrads are lighting up in excitement. They're looking at issues of food security, the environment, and human rights, and coming up with ideas."

Clark says that in the early years of social entrepreneurship as an academic field, the challenge was all about coming up with workable ideas. Then people began studying impacts and tracking results. "In the second phase we had ideas and wanted to understand why they weren't having a greater impact. Foundations and universities got together and said 'we want to understand how to scale these projects.'"

A lot of data was collected, and patterns and mistakes were tracked. And then scholars realized: capital markets and regulatory and legal frameworks were designed for business as we know it, not for a new and different world of social entrepreneurship. "For the entrepreneurial R&D engine to work, we also have to change the system that we are trying to change--the whole system itself," says Clark. "The third phase was realizing it's not just the entrepreneur to drive change; we need to engage the ecosystem."

When Muhammad Yunus started lending to the poor in Bangladesh, he had to go to the government and ask for a special designation, for the legal framework to be changed. "There are very few social innovations that can scale up without regulatory help--the carrot or the stick," says Clark. Think about how governments had to introduce incentives to get renewable energy off the ground.

That's why Clark's students at Duke also study public policy. "Social entrepreneurship works from the bottom up, but we also need policy to work from the top down. We need to get policy to pick up the stuff that works and get it to scale," she says.

Clark directs the CASE Impact Investing Initiative, or CASE i3, a project to prepare leaders and organizations for social change, and for building and evolving the field of impact investing. CASE i3 works with projects on the ground in East Africa and India in health care, for example. In one instance, it became clear that delivering medicine and diagnostics to rural areas of sub-Saharan Africa by motorcycle was going to be cheaper and reach more people than building stationary clinics. "Governments have become engaged as investors as well as customers to complete 'last mile' health access for their most disadvantaged populations," Clark says.

Millennials are moving towards a cross disciplinary way of thinking, and showing a desire to make an impact. The association Net Impact has grown from a student club at Berkeley in 1993 to a 60,000 member group today with chapters on campuses and in cities, with activities, events and brainstorming sessions on how members can make a more positive impact on society.

Entrepreneurs know they have to engage in systems thinking and look at forests, not trees. In order to bring about real change, we need to promote that kind of thinking and make our compartmental organizational model a thing of the past.

 

Published on: Mar 19, 2015